The __init__.py file serves two main purposes:

1. It makes a directory a package, allowing you to import modules from it.
2. It can contain initialization code for the package.

Example:

If you have a directory structure like this:

mypackage/
├── __init__.py
├── module1.py
└── module2.py

You can import modules from mypackage like this:

from mypackage import module1